750-bln-yuan new loans expected in Feb.

China's new yuan-denominated lending is expected to reach 750 billion yuan (119.47 billion U.S. dollars) in February, the China Securities Journal reported on Thursday.

Both Shenyin & Wanguo Research Co. and the Industrial Bank gave the same prediction to the paper. The figure, although slightly higher than that of the same period last year, shrank markedly from the 1.07-trillion-yuan new loans seen in January.

The decline may be attributed to inadequate bank deposits as the three-year-high lending in January drained banks' credit lines, according to the China Securities Journal.

Newly added bank deposits will decrease to 600 billion yuan in February, in sharp contrast with the 1.11-trillion-yuan increase in the last month, Shenyin & Wanguo forecast.

A manager of a Zhejiang-headquartered bank said the bank is cautious about lending at present.

The manager was quoted as saying that, based on risk control and given limited deposits, the bank confined its lending despite receiving many loan applications from needy businesses, particularly small and medium-sized firms.

A survey conducted by the Shanghai-based research center CEBM showed most of China's urban banks slowed their lending pace in February as some 60 percent of lenders surveyed saw falling business.

However, banks may strengthen their efforts in the next month on market prospects of continuing loose liquidity, the paper reported, citing sources from several banks.

Small and micro-sized businesses, real economies and urbanization will be the top three borrowers in March, said an analyst who declined to be named.

Ni Jun, an analyst with Shenyin & Wanguo, predicted the country's monetary policy will remain stable in the short term, citing rising but still acceptable housing prices and a mild economic recovery that needs more observation.